DIA welcomes pokie fraud sentences
Internal Affairs has welcomed the sentences handed down in the Wellington High Court today in the multi-million dollar
gaming machine fraud case.
The Department’s Gambling Compliance Director, Gareth Bostock said it reflects how seriously the court views the
misappropriation of community money and sends a strong message over corrupt practices in the gambling sector.
The defendants, Michael Joseph O’Brien (58) of Blenheim, Paul Anthony Max (60) of Nelson and Kevin Coffey (57) of
Hastings, were convicted of Crimes Act charges of ‘Obtaining by deception’. Michael O’Brien was sentenced on five
charges to 4-1/2 years’ prison and Kevin Coffey, on one charge, to 12 months’ home detention. Paul Max will be sentenced
on three charges on 27 July.
The major investigation named Operation Chestnut and prosecuted by the Serious Fraud Office (SFO), involved the SFO, the
Police’s Organised and Financial Crime Agency of New Zealand (OFCANZ), and Internal Affairs (DIA).
“This multi-agency approach was necessary to break through the criminal behaviour that had developed in some parts of
the class 4 gambling sector,” Mr Bostock said. “New Zealand communities should expect the highest integrity from the
gambling sector so that community organisations can access grants from gambling societies without the concern that
funding is being directed unlawfully.
“The Department has a specialist team of investigators and continues to investigate fraudulent activity in the sector.
We have developed an enduring model for working together with the SFO and the Police and will do it again if the need
arises.”
Through the Chestnut investigation the Department cancelled the licences of two gambling societies and took steps to
ensure that a number of unsuitable people were unable to continue working for societies or the pubs which house pokie
machines. The Department is applying a high level of scrutiny to societies before licences are granted or renewed.
“We want to ensure that the right people with the right motives enter the sector and that their activities are
consistent with the law,” Mr Bostock said.
“Operation Chestnut was necessary because gambling grant funding was being diverted away from the communities it was
meant to serve. The sector needs to create a culture of integrity where this type of behaviour is not tolerated and
everyone involved in the industry ‘does the right thing’ by communities.”